September 3, 2012

 

Germany expects grains crop up 6.7% on year

 

 

Welcoming the forecast as a counter to tight world supply and high prices, Germany's 2012 crop of all types of grain is likely to increase by 6.7% on year to around 44.7 million tonnes.

 

German grain prices are about 25% higher than this time in 2011 because of the rise in international prices caused by the drought in the US Midwest, the agriculture ministry said.

 

US corn and soy prices hit record highs this summer as scorching temperatures and a relentless drought ravaged crops in the US. Wheat has also surged with the Black Sea drought and poor rains in Australia adding to supply worries.

 

The ministry also said in its provisional 2012 crop forecast, Germany is likely to harvest 22.5 million tonnes of wheat, down 1.5% on the year.

 

The wheat harvest forecast compares to 22.8 million tonnes estimated by Germany's leading grain trading house Toepfer International, 21 million tonnes estimated by the German farmers' association and 22.3 million tonnes forecast by the agricultural cooperatives association.

 

Germany's grain harvest has been completed except for a few very minor areas, the ministry said in its first harvest report.

 

German wheat plants suffered from an exceptionally cold winter which damaged about 12% of the planted area of winter wheat, the ministry said.

 

Much wheat was then replanted as spring grains. The good development of spring grains helped raise the overall crop total despite the drop in the crop of winter wheat, the key bread grain, the ministry said.

 

The harvest start was delayed by repeated rain this summer. But dryer weather in past weeks has enabled the crop to be gathered, it said. Quality of bread grain including wheat is "overall satisfactory" although wheat in some areas has lower protein content than hoped, it said.

 

The winter rapeseed crop of 4.8 million tonnes was 25.3% above last year's last year's crop which in turn had been exceptionally reduced by bad weather, it said.

 

The ministry continued to intensely monitor price developments in international markets.

 

"We are following the developments very closely and remain in close contact with our partner country and international organisations," said Agriculture Minister Ilse Aigner in the report. "Because price rises especially hit the people in the poorest countries in the world, the current situation demands the highest vigilance."

 

G20 nations taking stock of the third global food price surge in four years will wait for September's crop report from the USDA before deciding whether to take joint action on the issue, France's farm minister said on Tuesday (Aug 28).

 

"In Germany it is reported that the grain market is quiet," the ministry said. "The high producer prices are minimising demand. The compound feed makers and mills are making only restrained purchasing."

 

He added, "There is no sign of a tight market supply for later months. As last year, farmers are again putting their harvest into storage and there is sufficient on-farm storage capacity. It is especially for bread grain and feed barley that there is a weak level of willingness to sell by farmers."